I found "Stopping the Talent Drain" in the July 2006 issue of Business 2.0 fascinating. Columnist Jeffrey Pfeffer profiles LECG, an expert services company that does a remarkable job of retaining its talent.
Key aspects of the management approach: Director-level employees receive 70-80% of their hourly billings as compensation. Less senior consultants get 30-60%. Management is decentralized. For instance, want to attend a conference. The company pays half, no questions asked. Want to publish a paper? Go for it! Did a group effort bring in a contract? The attribution fee allocation is sorted out by the group that pulled it off.
Good read. No. It’s not outsourcing-specific; but talent drain is a challenge for service providers. Maybe the smart ones could take a lesson…